Business New Brunswick defends bad investments

NDP Leader Dominic Cardy says $151 million tossed 'down the drain'

Government records say about two in 10 Business New Brunswick loans and investments ended in bankruptcy or closure in the past six years.

The list of the status of the province's investments since 2005 was obtained by The Canadian Press through the Right to Information Act.

The documents say that until September of 2011, it handed out about $653 million in repayable loans, loan guarantees, equity investments and other forms of grants to companies.

Of that, about $151 million was loaned or given to companies that are now listed as out of business or bankrupt.

Business New Brunswick Minister Paul Robichaud says the Progressive Conservative government is going to take a new approach with its investments.

He says going forward each investment will be carefully scrutinized and he promises no political interference in the decisions by staff.

The province says that some of the bankrupt companies bailed out by the province still are operating, though with new owners.

The province is also attempting to recover some of the money owed by failed firms.

Record is not good enough

Donald Savoie, a professor of public administration at the University of Moncton, says that in an era of cuts to basic social services, that record isn't good enough.

He says the province should scrap Business New Brunswick and instead promote the fact that the province has some of the country's lowest corporate tax rates.

NDP Leader Dominic Cardy said the Liberal and Progressive Conservative governments have thrown "more than $150 million down the drain."

"Money we need for schools, for research and development, to tackle poverty. Mr. Premier, shut down Business New Brunswick. Put a stop to corporate welfare. Liberal and Tory businesses will have to go somewhere else to find money to waste," Cardy said in a statement.